Beauman
I was wondering this myself recently. There are, I think, two pijnts which are being picked up here. the first is the sense of formation flying in a large group of dissimilar aircraft and quite simply without extensive training and practice and building up to groups of four ship or similar just dont do it. I regularly fly fourship with very different aircraft in the box and it takes a lot of planning particularly around speed and energy management.
The second question is one of legality and i have yet to ask the question of the person i was going to approach but my reading is that you are allowed to fly at the location of an air display within the heights / distances provided it is not part of the display and is 'normal aviation practice'. It is the question of what is normal which I think needs some interpretation. I have been at air displays where either individual or a small formation of non displaying aircraft arrived for a low pass and then landed. Some of the pilots were DA holders but this is not relevant in this case as they were not part of the display (ie the display was authorised for a specific number of acts).
I am not aware of anyone being taken to task by the CAA after having done this and I know that they were aware.
That suggests to me that in pracfice the CAA does not regard this as actionable although I am not sure this is much of a defence if your formation flying is ragged and you touch causing props and engines to spray the crowd.